Why the IHSG Suddenly Plunged to 6,900: Exploring the Metal Mining Slump and Global Factors

Investors were caught off guard this Friday as the Indonesia Stock Exchange (IHSG) took a sharp turn for the worse. After showing some promise earlier in the session, the index suddenly plummeted to its lowest level toward the close of trading. By the time the final bell rang, the IHSG was down significantly, weighed heavily by a massive sell-off in the metal mining sector.

According to the latest data from RTI Business, the IHSG closed with a 2.86% drop, landing at the 6,969.39 mark. This was a stark contrast to the morning session, where the index actually opened in the green at 7,189.83. The momentum shifted drastically during the second session, sending ripples of concern throughout the domestic financial market.

The Mining Sector Under Pressure

The primary culprit behind this sudden dive appears to be the proposal to increase royalty rates for mineral and coal commodities (minerba). This government plan, aimed at boosting state revenue, triggered a wave of panic selling in metal mining stocks. Herditya Wicaksana, Head of Retail Research at MNC Sekuritas, noted that this policy shift significantly burdened the index as investors recalibrated their expectations for future profitability in the sector.

The impact was immediate and visible. PT Timah (Persero) Tbk (TINS) saw its share price crash by 14.88%, hitting the Auto Rejection Bottom (ARB) at Rp 3,490 per share. This was a steep decline from its opening price of Rp 4,130. Similarly, PT Vale Indonesia Tbk (INCO), another key player under the MIND ID holding, saw its shares tumble 13.89% to Rp 5,425, down from an opening high of Rp 6,325.

Global Turmoil and the Rupiah's Struggle

Beyond domestic policy changes, the IHSG was also fighting an uphill battle against global headwinds. Geopolitical tensions, particularly the ongoing and unresolved conflict between the United States and Iran, have kept global markets on edge. This atmosphere of uncertainty has trickled down to Asian markets, causing a widespread correction.

Looking across the region, the Nikkei 225 in Japan dropped 0.19% to 62,713.60, while Hong Kong’s Hang Seng Index fell by 0.87% to 26,393.71. The Shanghai Composite Index also moved into the red, and Singapore’s Straits Times Index (STI) followed suit with a 0.41% decline. This regional weakness made it difficult for the IHSG to find any solid ground to stand on.

Compounding these issues is the weakening of the Indonesian Rupiah. At the close of today's trade, the US Dollar strengthened by 0.28%, pushing the Rupiah down to a concerning level of Rp 17,382 per USD. This currency depreciation often triggers capital outflows, adding further pressure to the stock market.

Macroeconomic Indicators and Slowing Property Growth

Internal economic data also played a role in the day's bearish sentiment. Research from Phintraco Sekuritas highlighted a decline in Indonesia's foreign exchange reserves, which fell to US$ 146.2 billion in April 2026, down from US$ 148.2 billion in the previous month. This marks the lowest reserve level since July 2024.

This decrease in reserves was driven by several factors, including the payment of government foreign debt, the issuance of global sukuk, tax revenues, and efforts by the central bank to stabilize the Rupiah. While the current reserve level is still considered sufficient to cover about 5.6 to 5.8 months of imports and debt payments, the downward trend serves as a cautionary signal for the market.

To top it all off, the property sector is showing signs of a significant cooldown. Real estate price growth slowed to just 0.62% year-on-year (yoy) in the first quarter of 2026, down from 0.83% in the final quarter of 2025. This represents the slowest growth rate for the property index since 2003, suggesting that the broader economic recovery still faces significant hurdles across various sectors.